December 17, 2008

From: President Kathleen Waldron

To: The Baruch College Community

As we wrap a successful fall semester at Baruch College, I want to wish everyone a happy holiday season and good wishes for the New Year. On behalf of every student at Baruch College, thank you for your hard work and support of our College’s mission.

I’m particularly proud of how our College community is focused on providing superior education and services to students despite the tough economic environment. As I mentioned in my previous budget updates in October and November (www.baruch.cuny.edu/president), we are taking steps to manage our operating budget for 2009 while also planning for 2010. We have already reduced tax levy spending by about 5% and slowed down the replacement hiring of certain positions as called for by the Governor earlier this year. While budget issues are still unfolding in Albany, I continue to monitor things very closely with the CUNY Chancellor and Vice Chancellors who are managing this situation with great astuteness and sensitivity. The Cabinet of Baruch College has met regularly to evaluate the situation and make recommendations and I had the opportunity to address the faculty of the three schools in the last week.

Yesterday, Governor Paterson proposed the State budget for the next fiscal year, 2009-2010. While the budget will not be finalized with the Legislature until some time in the spring, we are expecting that 2010 will be an even tougher budget environment than this year’s. I encourage you to read the Governor’s full budget outline, which is available at www.budget.state.ny.us.
On higher education, the Governor wrote: “Based on the recommendations of the New York State Commission on Higher Education, the Executive Budget would establish the New York Higher Education Loan Program (NYHELPs) which will provide a minimum of $350 million in loans to approximately 45,000 New York State residents attending New York higher education institutions. The loans will be offered at rates well below those currently available in the private loan market. Additionally, a SUNY ($620, 14%) and CUNY (up to $600, 14%) tuition increase tied to an investment plan is also recommended, which will provide a year-to-year increase in core instructional budget resources for those universities.”

Part of preparing and protecting students is to be forthright so they have all the information and can plan accordingly. On December 8, the CUNY Board of Trustees proposed tuition increases that the State is now echoing. At the same time, Chancellor Goldstein and his team also focused on defraying the adverse affects of the proposed tuition increases and underscored the commitment that no student in need of financial assistance will be denied access to the City University.

Below is an excerpt from the full announcement (available at www1.cuny.edu/news/index.html).

• To help students better prepare for the financial challenges ahead, Chancellor Matthew Goldstein has announced a multifaceted effort combining assistance and information on financial aid, scholarships and career counseling with opportunities for full-time and part-time employment. The University plans to set aside $10 million to establish an Institutional Financial Aid Initiative to assist those students who will be placed at risk of continuing their matriculation due to higher tuition rates, as well as to drive down the cost of textbooks for CUNY students.
• This Initiative also includes the implementation of a CUNY Work-Study Program, akin to the Federal Work-Study Program, that will make jobs on CUNY campuses available to students in need of financial assistance. In addition, the University has created a website called Jobs for Students (www.cuny.edu/studentjobs).

As we monitor external forces, we also continue to manage internal factors. The effects of the current market volatility on the Baruch College Fund endowment have reduced our endowment and assets by 16-17% this year. Although this decline is serious, many universities have experienced much more severe negative returns. And I want to reassure everyone that Baruch did not have funds at risk in the latest market scandal which you all have read about in the papers for the last few days. With ten percent of Baruch’s operating funds coming from philanthropy through the BCF funds, we are balancing the equation by cutting projected spring and summer spending by approximately 18% or $3 million on an annual basis. Because the cash flow we expect for next year will be affected by the decrease in endowment earnings and some slow down in charitable giving, we believe this is prudent planning. Each of our Vice Presidents and Deans are working with all of you to detail how we are going to achieve these reductions. We are looking at expense reduction for travel, some student assistantships, operating expenses and other options. However, since hiring faculty and student support personnel directly impacts students, we continue to search for the six to ten faculty lines previously announced and will carefully search for selected student support positions.

The financial situation in 2010 will be difficult for NY State, CUNY and Baruch College. We believe we are taking the necessary steps at Baruch College—in cooperation with Chancellor Goldstein and the entire CUNY team—to ensure that we continue to provide our students with the best possible education and foundation for successful careers.

Your commitment and willingness to contribute to solving these budget problems is encouraging and reinforces the Baruch entrepreneurial spirit.

Thank you and Happy Holidays,

President Kathleen Waldron